Statewide lodging tax bill moves to Legislature

By Nick Reynolds

Casper Star-Tribune Via Wyoming News Exchange

CASPER — As Wyoming’s primary industry — energy — cycles between times of boom and bust, the state’s other main economic driver continues its steady, if unassuming climb.

Last year, visitors spent nearly $3.6 billion in Wyoming, according to a report prepared by the Wyoming Office of Tourism. Since 2007, tourism spending has increased by about three percent annually.

But as the tourism industry continues to grow, the budget for the state’s tourism office has remained flat. In fact, the office hasn’t received a boost in budget or staffing levels for more than eight years.

This has made industry professionals a bit nervous, considering the source of the tourism office’s budget — the state’s general fund — is tied to the success of the state’s oil and gas industry, which is highly volatile.

For several years, state lawmakers have been working to figure out a way to fund the state’s tourism industry independent of the general fund, with little success. In the 2019 general session, however, local governments and industry professionals feel they may have a compromise to do just that, and will introduce a bill proposing the implementation of a statewide five percent lodging tax.

If passed, the tax will guarantee funding for the state’s tourism programming on a level competitive with surrounding states (Wyoming currently ranks 31st, behind states like Utah, Colorado and Montana) while locking in guaranteed funding for local governments to allow the flexibility to respond to the impacts of increased tourism.

While labeled as a five percent tax, that is a bit of a misnomer: out of the five percent, three percent will fund statewide tourism promotion efforts — which are subject to executive oversight — while the other two percent will go to local governments. This portion of the funding, however, won’t kick in until existing local lodging taxes expire, in order to avoid too much of a burden on municipalities.

An amendment on how that would roll out will be included in the bill when it is introduced to the full Legislature in January.

While industry professionals and lobbyists for municipal governments were admittedly reluctant to discuss any new taxes, reaction among the tourism industry and municipal groups has been largely favorable, with many testifying at a legislative meeting Thursday in Cheyenne that this solution was likely the best compromise to move tourism funding out of the state’s general fund and a more attractive bill than a failed lodging tax proposed last year.

How the funds can be allocated was a significant focus of discussion at Thursday’s meeting. In Teton County, the prospect of spending more tourism money on mitigating the impacts of tourism traffic, rather than further promotional efforts, has become a campaign issue, prompting some to consider amendments that could allow tourism funds for purposes other than promotion.

How to do that was up in the air and, while legislators expressed an awareness of the need to allow local government’s flexibility to spend money to address the problems popularity can bring to a community, an amendment to allow flexible spending of those funds was not considered.